February 18, 2005

"Gladly, this year I think we can do more for public education. But going forward we fundamentally have to, I think, address the paradigm that we've relied on to fund education, and that is expanding our revenue base." - Governor Huntsman

Reporters (in order of appearance):

DAN BAMMES, KUER
MATT CANHAM, SALT LAKE TRIBUNE
RICHARD PIATT, KSL-TV
LISA RILEY ROCHE, DESERET MORNING NEWS
LEE AUSTIN, UTAH PUBLIC RADIO
TOM JORDAN, METRO NETWORKS

Transcript:

DAN BAMMES, KUER: Governor, thank you for joining us today. And we're near the end of the legislative session, it's sort of crunch time as far as budget goes, and the time when things tend to get very interesting. Earlier this week your chief of staff was quoted as saying you were "riding the freeway of love" in your talks with legislative leadership, at least on budget issues, and I was wondering if you'd still characterize it that way.

GOVERNOR HUNTSMAN: Well, thanks Dan, for the question. That may have been, in a sense, hyperbolic, but we are engaging in a very useful dialog. It is moving our budget priorities forward. I think it is bringing us to the concluding days of resolving formally a budget for the state, which I think is good news. In other words, I think the relationship is right where it should be. The mechanics of government are working between the branches, and I think that's probably a pretty good thing at this point in the session.

DAN BAMMES, KUER: The critical number that people have been talking about is the new spending for ongoing transportation projects. Numbers have been cited anywhere from the 33 million you originally suggested up to 95 million dollars. Do you know where that's finally going to shake out?

GOVERNOR HUNTSMAN: I don't know where it's finally going to shake out, but I think with the new revenue numbers that came in earlier in the week, we're probably going to be able to achieve more for transportation. What that final number is I don't know, we're still in the middle of those negotiations. But I think it also means that we're going to be able to achieve some of the other programs that I put as priorities on my list, and we'll probably know, I suspect, at some point next week where that's going to shake out. But the number for transportation is still a little bit of a moving target.

Transportation is important. There's no doubt about that, and I want to give transportation all the support I can, while at the same time achieving some very important objectives in terms of compensation for state employees, in terms of a WPU number for education that I feel is sufficient enough. Also for teacher incentives, I've got some ideas that I'd like to launch into the marketplace, that I think would be good. There are also some Medicaid issues, dental and vision, that I think, for me, anyway, are basic human need issues that I'd like to see part of the budget. So it's still, in a sense, a give and take, as these things usually are at this point in negotiations, but I think by next week it should probably settle out to the final numbers.

MATT CANHAM, SALT LAKE TRIBUNE: Governor, there's been two base budget bills passed, one for schools, one for base budgets for other programs. That school bill includes an increase for the WPU. Those bills are on your desk but haven't been signed yet. Do you have any concerns for those base budget bills?

GOVERNOR HUNTSMAN: Well, I don't have any concerns about the base budget bills, so long as we are able to achieve, again, some of the priorities that I just enumerated for you. So long as we have a compensation package for our state employees that meets that 4.5 percent total level between COLA adjustments and benefits. So long as we're able to include the market comparability measure that carries with it a price tag of about $14.7 million it would address, I think, the undercompensated employees who are part of highway patrol and corrections and other areas. So long as we have a WPU that is at the 4.5 percent level, then I think I'll feel comfortable with it. We have base budgets, but you have to remember that, in addition to those base budget numbers, we still have some ongoing negotiations that we're in the middle of. And I just want to feel comfortable before I sign HB-1 that we are on target to hit some of these percentages, some of these numbers that I consider to be priorities going forward.

RICHARD PIATT, KSL-TV: Governor, before the new budget numbers came out, there was a disagreement on some of the priorities between you and the legislature, and on one of the bills that Speaker Curtis was sponsoring about the veto power. What's your experience been in learning how to deal with the legislature in your first term?

GOVERNOR HUNTSMAN: I know no other way, other than being open, communicative, transparent, putting your cards on the table. In other words, I'm not one who's going to play a lot of negotiating games. I just don't believe in that. I've been in business negotiations, I've been in trade negotiations, I've been in diplomatic talks before, representing my country. I have found that the best way to negotiate an end point to whatever it is you're undertaking is to put your cards on the table, to be honest from the very beginning, and to move toward whatever your objective is as quickly as you can.

And that's the spirit with which I have been delivering some of my priorities. In fact I went so far as to put a good many of them on my to-do list. And I carry this around with me every single day. They haven't changed a bit. So I can look myself in the mirror every morning and say, "We're still on target for economic revitalization programs, we're still on target for education, still on target for quality of life, still on target for governance. And I was very honest early in the session in terms of what I wanted to achieve, and I think you will see that I haven't changed a whole lot from then up until now.

LISA RILEY ROCHE, DESERET MORNING NEWS: Governor, though, you talk about being open and communicative, and being very up front about what your goals have been all along, and yet lawmakers took it upon themselves this time to create a new type of budgeting process, by passing part of the budget, they called it the base budget, but it also included that very controversial piece of transportation funding. Do you think they've played fair with you this session?

GOVERNOR HUNTSMAN: Well again, as I think I mentioned before, fairness is subjective and in politics. Again, some in the house were looking for 85, 95 in transportation, I think 70 was a number that they arrived at on the base budget. I don't know what their past practices have been, so I'm not going to hold this against them. I'm starting new this year. There's a new speaker of the house, new president of the senate, and all I can tell you is we're doing our best to work in good faith toward their objectives and my objectives, and I think we're going to see a lot of them achieved at the end of the day. And I think that's good for the citizens of the state.

DAN BAMMES, KUER: Governor, we have a question now from Lee Austin with Utah Public Radio, who's at our remote site in Logan.

GOVERNOR HUNTSMAN: Hi, Lee.

LEE AUSTIN, UTAH PUBLIC RADIO: Hello, thank you. There are a couple of senate bills that would have a major effect on the way the state's largest health care provider, Intermountain Health Care, continues to operate, and a lot of different views on those. IHC is buying a lot of advertising to make the case that this is very bad legislation, and it's not been well studied. I'm wondering if you have been consulted, if you have any views on that. Is it taking too drastic an action this session? Should it just be studied? Or what is your position?

GOVERNOR HUNTSMAN: I think it's an important debate, as all of these things are. This is what we ought to be doing as a free society. In terms of any willing provider, I think there is some good that is part of any willing provider, and I will look at the content of that piece of legislation as it gets closer to my desk. But opening up the marketplace, regardless of what insurance program you happen to be on, I think is probably good for consumers. As it relates to the 3 percent gross tax that was talked about, at least initially, on IHC, and I think that's kind of morphed into looking at IHC spinning off part or all of its insurance subsidiary, I think needs to be locked at very carefully. And again I'm taking a very balanced view on this.

Personally, I'd like to know what this means to the average consumer in terms of health care costs, in terms of insurance implications. I'd like to know what the job loss could potentially be. I'd like to know who some of the buyers might be for an asset that they were to spin off. I don't have answers to these questions. And I know if I don't have answers to these questions--I do this full time--there are no doubt a lot of interested consumers out there who have questions as well. I think it would behoove all of us to put this issue into an interim study commission, committee, call it whatever you want, such that we can get some of, some answers to the questions that I just raised. We can then make a more informed decision going forward. IHC might have some of their own business decisions that they have made by then. I just think we need to let rational thinking prevail, and let the numbers kind of guide us through this decision. And at the end of the day, we ought to be prepared to do that, which is good for the consumer in an environment where he we see ever-escalating health care costs.

TOM JORDAN, METRO NETWORKS: Governor, on sort of that same kind of line, we came into this session looking at the enormous issue of tax reform. And it looks as if what's happening is sort of bits and pieces being discussed, rather than the entire entity. Does it look like it's a good idea at this point to back the notion of a tax reform task force to deal with this a year from now, in the session, rather than trying to do sort of, you know, hit-and-miss individual bills?

GOVERNOR HUNTSMAN: Well you have to start someplace, and as it relates to the corporate tax, I've talked about it because I think that's that is a good place to start. You have to remember that we're looking at essentially a 7-year phase-out. I just got an interesting letter from my friend, Bob Taft, who's the governor of Ohio, and he gave me a little card that he's undertaking here, and they're phasing out the corporate franchise tax in Ohio. And they're doing it more aggressively than we are. And they're doing it for competitiveness purposes. They're going through the same level of analysis as it relates to tax reform. They're looking at many of the same areas we are. And I suspect, and I'm doing a little study internally just to satisfy my own curiosity, I'd like to see how many states in America are, in fact, undertaking a comprehensive tax reform as we see many of these economies that are going from sort of the industrial age to the services age. And what are the implications, and for those who are paying and those who are not paying? These are very important questions, and they need to be addressed.

But we'll have a task force that is set up that will begin right after the legislative session concludes, and it will take us through the better part of the year. And I hope by November of this year we have some real answers as it relates to the direction on tax reform. I think Governor Walker did a very good job through her tax experts in putting on the table some initial ideas as it relates to services, individual, corporate. And I think that, for me, is a good place to start this discussion. And I'd like to end this discussion not too far removed from many of the conclusions that were presented in her findings.

You have to ask yourself the question, as I do so often as a new governor, what will the market bear legislatively? What can you get done in a very short session, particularly when you didn't have a lot of lead time to get the data and the arguments before many members of the legislature? So I think as we begin this task force, which will be a very important one for the state, and as it begins fairly immediately after the session concludes, we'll work very hard with Senator Bramble and with others in coming up with a good set of recommendations, and we'll be prepared to put them forth a year from now at next year's legislative session.

RICHARD PIATT, KSL-TV: Governor, with regards to the kind of morphing some of these issues together, there are some business leaders yesterday who held a rally in the building that you reside in that were concerned about the any willing provider bill with regards to how it would affect small business owners. You've got the corporate tax, and how people from out of state are viewing that, potential businesses coming in. When you look at any bill like the corporate income tax, like the any willing provider, are you looking at it from the economic development standpoint? In other words, what people from outside are looking at with regards to Utah and how that may affect their future here, and how that may affect their business and operations?

GOVERNOR HUNTSMAN: Well I'm looking at a couple of things. I'm looking at it from an economic development standpoint, clearly, but I'm also looking at it based on a human needs standpoint. And that is, what can the average family access in terms of health care? What is it going to cost them to access health care today? Why are the prices escalating, the costs, so rapidly as they are today? So yes, I'm driven by economic development , but at the end of the day for me, it's going to be a level of analysis that goes right to the individual, and what's good for the individual citizen of the state. And what extra burdens are they carrying going forward as a result of what we're doing? Or are we streamlining a system that allows them better access to care at a better price?

I wouldn't have written a letter, along with six or seven colleagues, to the prime minister of Canada on importation of pharmaceuticals from our neighbor to the north, in the process receiving a lot of unfriendly mail from pharma and others, if I wasn't willing to get out there and do what is best for the consumer. I think there's a lot we can do for the consumer at the end of the day in trying to at least attack these escalating health care costs that are driven by pharma costs, that are driven by frivolous lawsuits. There's a lot we can do. So at the end of the day my analysis is always going to go, yes, somewhat to economic development, but more to the point, to the individual who's affected by this policy.

DAN BAMMES, KUER: Governor, the legislature responded to your call for emergency help for the Washington County and southern Utah after the flooding there. Are you convinced now that the state has done what it can for those communities? And how has that changed your perspective on Utah's preparedness for other natural disasters?

GOVERNOR HUNTSMAN: Well it's a very good question. You can never do enough for people who lose their home and who lose their most prized possessions, as we saw happen to so many families in Washington County. We'll continue to do what we can from a private funding standpoint. Some of us are going to be involved in an effort to raise private funds in the weeks to come for those who lost their homes. We can never do enough for those people who are truly down and out as a result of what happened.

Are we doing enough in terms of working with the federal agencies that are now stepping in and doing what they're supposed to do, whether it's the Department of Agriculture or FEMA? I think we are. We are moving that through the bureaucracy as quickly as we can, and we hope to get FEMA funding in the next ten days to two weeks. We hope to get more in the way of federal government support for shoring up the shore lines, for examples, of the river banks that will cost a whole lot of money going forward. We're working with the Department of Agriculture on their piece. So yes, I think we're doing, as a state government, all that we're supposed to be doing, and more, to ensure that the federal component is moving as it should.

But you're never prepared for this kind of thing. You simply react based upon your best instincts. And good, common sense at the end of the day. Does this mean that we're perhaps better prepared for what lies ahead? I'd like to think so. I'd like to think that some citizens are actually thinking through what it might mean to have flood insurance, who weren't expecting a once-per-century event to flow through their neighborhood.

As we look to spring, I think if you look at the potential for runoff, it is clearly there. I'm not a meteorologist, but I talk to them. And if you look at rainfall, when you look at level of saturation, when you look at the weather patterns that are expected between now and spring, I think they would tell you that we're probably somewhat akin, if not beyond, to the numbers that were faced in 1983, when we saw a lot of flooding here in Salt Lake City. And that means we probably should learn from history, let history be our guide in this case. And yes, we've ordered 250,000 sand bags, and yes, we have Commissioner Flowers who is going to be coordinating through public safety with local governments to ensure that we are ahead as opposed to behind, if we do experience flooding incidents in those areas that are most vulnerable. So we are learning the lessons that I think the Washington County floods had to offer, and I think we'll be better, smarter, and faster as a result.

TOM JORDAN, METRO NETWORKS: Governor, as I was driving over this morning I was listening to a discussion on the value of symbolic victories in politics. You haven't been at it terribly long. Do you anything you would consider a symbolic victory, or when we get to the end of this legislative session is there something you'd like to be able to say, "We did something that actually matters in a way that's of some consequence"?

GOVERNOR HUNTSMAN: Victories come in different forms, and different shapes and sizes. I'd like to think that the whole B-C waste equation will be an important victory. Perhaps symbolic to a lot of people, perhaps very real to others. The fact that I'm carrying with me every day of my life a card, a score card that lists my priorities, I think at the end of the session I will be able to say then, in each of those categories we were able to achieve a victory.

In terms of moving along the public policy priorities that we have spelled out, I think that will very much be a victory, not just for the governor's office, but for our political system. And again, I'm not alone in this undertaking. We've got a great staff, we have the legislative body to deal with. The machinery has to be running, and it has to be well-oiled, if you expect anything to result. And I think we're going to have some pretty good results this legislative session.

What will I consider victories at the end of the day? We'll just have to wait and see. But the fact that my family still opens the door and lets me in the house every night when I come home, and my kids still call me dad, that, to a certain extent, is a victory, given everything else we're trying to do at this point.

DAN BAMMES, KUER: Governor, we have another question from Lee Austin at our site in Logan.

LEE AUSTIN, UTAH PUBLIC RADIO: Thank you. The budget, health care, the issues we've discussed aside, I'm wondering if there are any policy issues that your office is actively engaged in negotiating with the legislature to either see passed or kill, things like tuition tax credits, even hate crimes, smoking in taverns and private clubs, some of those high-profile bills.

GOVERNOR HUNTSMAN: Thank you, Lee. I am sticking to my four priority areas. I've outlined over and over again exactly what I will expect to see done at the end of the session, what I hope to see done. And in terms of a lot of the other pieces of legislation that are wending their way in some form or fashion to my office, I'm not going to get too immersed in the detail until I know it's actually going to make it to my office. We have to remember that legislation takes a lot of twists and turns as it goes from body to body and as it is deliberated. So I'm going to wait until we see, for example, tuition tax credits in its final form. I'll wait until such time as I see other somewhat sensitive pieces of legislation, until they're in final form. There's not a whole lot that I can do on some of them right now. You have to wait for the body to work their magic individually in getting them to the governor's office. And as soon as I know they're going to hit my office in some final form, that's when I'll begin to engage.

LISA RILEY ROCHE, DESERET MORNING NEWS: You said earlier on the IHC bill that you'd like to see those go to interim rather than be enacted this session. If those bills come to your desk, does that mean you'll veto them to ensure that they are not enacted?

GOVERNOR HUNTSMAN: Well that would be speculative at this point. Let's just say that I'll work, as these pieces of legislation near their finished form, with the appropriate bodies in trying to figure out a solution that makes sense. But listen, you can mold and shape the outcome just by speaking out, as we're doing right now, in terms of what you like to see done. And I was on a radio program or two last week where I basically said the same thing.

I think it would be important for us to study, in this case, the IHC issue so that we know exactly what the implications are going to be for the consumer. I think the most important person in this whole debate, and I hope that person isn't lost in terms of who wins and who loses. And so yes, I can make my opinion known, and I think the legislature will interpret that any way that they want. But as soon as I know it's going to get close to my office, then we'll prepare whatever an appropriate response is.

RICHARD PIATT, KSL-TV: Governor, can I ask you a question about education? You talked about the WPU being fully funded this year, but it does seem like on some level it's the same old fight in the legislature. The education advocates are screaming and trying to get the WPU funded, and it looks like it may get funded to the point that they want for this year. But long term there's that influx of students that's being expected over the next ten years. It doesn't really seem like there's anything that's being addressed long term in dealing with education funding. Is that something that you're thinking about, and do you have some ideas about that, or do you think a tax increase might even be inevitable?

GOVERNOR HUNTSMAN: Well it's the whole reason I'm in this race, I was in the race from the beginning, and the reason that maybe I'm sitting here in the governor's seat, and it's also the reason why, on my list of things to do, here, I have economic revitalization at the very top of my list of things to do. Because if we succeed there we will, in fact, longer term, have succeeded in broadening the pie and expanding the pie, as opposed to having a static pie that everyone seems to draw from. That's a lose scenario for a population that's adding 150, 160,000 new kids this decade to public education.

The only way forward, we've always had these annual debates on, "What is the right WPU?" Is it 1 and a half percent? Is it 4 and a half percent? Gladly, this year I think we can do more for public education. But going forward we fundamentally have to, I think, address the paradigm that we've relied on to fund education, and that is expanding our revenue base. And the only way we're going to expand our revenue base is by somehow getting entrepreneurs to expand their creative ideas in the state, to attract more business to our state, and fundamentally expand our tax base.

And I'm not alone in thinking that that is the appropriate way forward. I guess Bob Taft, the governor of Ohio, who I referred to earlier, is going through his same economic reform proposals for that very reason. The only way to pay the bills in many states that have Medicaid expenses that are escalating, that have transportation expenses that are unprecedented, that have education concerns, the only way forward is to expand the economic pie such that we can afford our future.

TOM JORDAN, METRO NETWORKS: What about the, one of your higher profile issues was to get a lot of new money into tourism funding, because that's a sort of an immediate payoff. Are you optimistic that that $10 million is going to come out at the end intact?

GOVERNOR HUNTSMAN: I think so. That would be the legislation of Senator Jenkins' moving forward, and the last I looked that was in pretty good shape.

MATT CANHAM, SALT LAKE TRIBUNE: Governor, in a move to restrict drivers licenses for undocumented immigrants, there's been quite a few bills. I just want to get your general sense of the topic, and maybe what course Utah should set in this area.

GOVERNOR HUNTSMAN: Well, we have to start from the premise that driving is a privilege, it isn't a Constitutional right. Second, we have to recognize that we have a large, perhaps just under 100,000 in terms of population size, undocumented worker population. Third, I think we have to conclude that they are an integral part of our economic base. You just can't wish them away and send them in buses south. That is highly unrealistic. So what do you do going forward? I think the idea that is on the table, which takes a chapter from the state of Tennessee--it's called the Tennessee model for a reason--that comes up with a driving privilege card that doesn't carry with it the privileges of citizenship, such as voting or being able to use it as identification. It's a good compromise position, and it's something that I support.

DAN BAMMES, KUER: Thank you very much, Governor. We're out of time. I'd like to remind our viewers that a transcript and a video streaming of this and all the Governor's News Conferences is available courtesy of the Utah Education Network, and you can access that on the Internet at www.uen.org. Thank you for joining us today here at KUED.

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